Economic Growth and External Sector Behaviour: A Cross-Section Analysis

Abstract

Economic development is a problem that is a concern of any economist, politician, government and business. Development is a means of achieving a higher standard of living, a better health system, an optimal quality of education, a high per capita level and low poverty rate. This study focuses primarily on development analysis. It involves economic model built to evaluate the impact of Remittance, Net export and Foreign Direct Investment (FDI) on GDP growth and development. It also includes an overview of the behaviour of these causes in the robust regression model which is estimated using 30 Asian nations. The economic model was built on the basis of GDP growth and the external sectors. It specifies that the variable that has the most significant effect on GDP growth and development is remittances. Net exports and FDI are positively related to growth in GDP, but since there is no significant connection, the evidence is not so strong. Over the last few years, Asian countries have seen remittance to rise. Thus its influence on GDP is growing as well. Finally, a study of the behaviour of external variables in developing countries was performed. A clear understanding of the development is provided in this paper.